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Swindling Subs Lands GC in Prison

Tuesday, March 18, 2014

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It took a Texas jury just an hour to convict a general contractor of duping subcontractors out of $100,000—and not much longer, after hearing his slippery story, to send him to prison for three years.
Keith Baxter Alexander, 54, owner of K.B. Alexander Company of Texas Inc., will also pay a $10,000 fine in the case, the Tarrant County jury decided after a week-long trial.
Keith Alexander
Tarrant County D.A.

Keith Baxter Alexander, sentenced to three years in prison, has a history of cheating subcontractors, prosecutors said.

The case marked what is believed to be the first time that a construction fraud case has gone to a jury trial in that Fort Worth-area county, prosecutors said.
Dealership Deal
In 2006, Alexander was hired to oversee construction of a used-car dealership in Fort Worth, the county District Attorney's office said.
Each month, Alexander would submit applications to the owner of the dealership, seeking payment for completed work. The pay application indicated that Alexander had been paying the subcontractors for their various jobs on the project.
In reality, however, the subcontractors had not been getting paid the full amount, if at all, prosecutors said.
The scheme came to light when the job was finished and the owner of the dealership started getting mechanics' liens from a variety of unpaid subcontractors. In all, seven liens totaling about $100,000 were filed against the dealership owner.
Construction worker on tablet
©iStock / stocknroll

The general contractor told the project's owner that the subcontractors had been paid. A rash of construction liens filed by subs after completion told a different story.

The owner then filed a complaint against Alexander with the D.A.'s office that eventually led to his indictment, arrest and trial.

Moving Target
Alexander had faced a sentence ranging from probation to 10 years in prison.
Although he had never been convicted of a felony, evidence presented during the punishment phase of the trial showed that Alexander had previously cheated subcontractors out of money. Over the years, a number of people had sued him in an effort to recoup their losses, prosecutors said.
To avoid paying, prosecturs said, Alexander files for bankruptcy, starts another construction company under another name, and resumes business as usual.
In fact, prosecutors presented evidence that Alexander filed for bankruptcy for a second time after the car dealership job and is currently operating under the name KBA Construction LTD.
After the jury heard about Alexander’s past history, they sentenced him to three years in prison and
assessed the $10,000 fine.



Tagged categories: Commercial Construction; Contracts; General contractors; Good Technical Practice; Laws and litigation; Subcontractors

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